In the wake of September 11, the United States appointed Richard Clarke as the country's first cybersecurity czar, to head efforts to safeguard information systems.

The United States agreed on December 12 to release Russian software programmer Dmitry Sklyarov in exchange for testimony about his company's alleged violations of U.S. copyright law.

An FBI spokesman confirmed in December that the U.S. government is working on an Internet surveillance tool known as "Magic Lantern," although officials would not comment officially on what it does.

Microsoft released its latest operating system, Windows XP, in October.

A court order forced Napster to close its free-for-all format in July.

A century ago, on December 12, 1901, Guglielmo Marconi proved that radio waves could send messages without the use of wires over thousands of miles, laying the foundation for modern-day radio, wireless technology and the digital age.

Nintendo launched its GameCube system to compete with Sony's PlayStation 2.

News was leaked in January about the impending release of a new invention called "Ginger," which was finally revealed to be a specialized scooter, now called "Segway.".

Top Technology Stories for 2001

By Daniel Sieberg
CNN.com Sci-Tech Editor

1. "Ginger," now called "Segway," is revealed to be a self-balancing, battery-powered scooter. Full story

2. The "Code Red" Internet worm causes about $2.6 billion in damage worldwide. Full story

3. Microsoft introduces the Xbox and Nintendo unveils the GameCube, to go head-to-head with Sony's PlayStation 2.Full story

5. Russian programmer Dmitry Sklyarov and his company, ElcomSoft, are the first to be charged under 1998's Digital Millennium Copyright Act after allegedly violating e-book copyright regulations. Full story

6. President George Bush extends the ban on Internet taxes for another two years. Full story

7. Richard Clarke is appointed to the head of a presidential cybersecurity task force after the September 11. Full story

9. Satellite radio begins to broadcast across much of the United States. Full story

10. Napster's usage plummets after a court order forces a close of the original format, but other companies move in to continue file-swapping online. Full story

(CNN) -- 2001 was a year imbued with promise by science-fiction author Arthur C. Clarke and filmmaker Stanley Kubrick, but analysts saw the reality of the technology world still waiting to embark on an odyssey of major advancements.

Perhaps the highest hype of the year touted "IT," or "Ginger," after news of its development was leaked to the media in January. Entrepreneur Dean Kamen, responsible for myriad health inventions including a wheelchair that climbs stairs, was said to be working on a product that could change the way cities were built.

Early speculation led to rumors of cold fusion and hovercraft, but when the device was finally unveiled in December, it turned out to be a specialized transporter that resembles a scooter, now called "Segway." While its self-balancing mechanisms and ease-of-use dazzled many people, others wondered aloud if the $3,000 machine isn't just a high-tech toy for the rich.

Viruses and worms continued to spread on the Internet in 2001, although none managed to replicate the economic damage of 1999's "Love Bug." However, a few came close.

In July and August, the FBI's National Infrastructure Protection Center took the rare step of warning people around the world about the impending threat of the "Code Red" worm -- named after the soft drink favored by the security team that first analyzed it.

Over the course of a couple of weeks, Code Red jammed numerous sites and caused headaches for system administrators around the globe. But its destructive capabilities were kept to a minimum, reducing any serious impact.

According to Computer Economics, Code Red did about $2.6 billion of damage, placing it at No. 2 on the most-costly virus and worm list. Also doing sizable amounts of damage in 2001: "SirCam," "Goner," "Nimda," "Anna Kournikova" and "Naked Wife."

The clash of the consoles heated up in the video game arena. Heavyweights Microsoft and Nintendo released next-generation consoles in November (Xbox and GameCube, respectively) to compete with Sony's PlayStation 2. Both companies claimed victory in the latter part of the year, although Sony remains the champion of total sales -- for now.

Microsoft also released its latest operating system, Windows XP (short for "experience"), in October amid continued legal wrangling. The United States Justice Department did not seek to delay the release of XP, despite concerns from certain groups that Microsoft was continuing to violate antitrust regulations.

Microsoft and the Justice Department agreed upon a settlement in November, but the District of Columbia and 18 states -- which had filed a separate suit -- failed to agree to the terms and split down the middle. Microsoft was also forced to deal with dozens of private antitrust lawsuits. The court proceedings roll on.

Despite the demise of Napster's free-for-all format, the use of peer-to-peer technology and online music swapping remained a popular endeavor thanks to emerging free sites like KaZaA, Morpheus Music City and Audio Galaxy, to name just a few.

Late in the year, subscription-based sites like MusicNet, which has the backing of RealNetworks, AOL Time Warner, Bertelsmann and EMI Group, began competing with the likes of Pressplay, which has the support of Sony Music Entertainment and Universal Music Group. (AOL Time Warner is the parent company of CNN.com.)

Napster is also expected to unveil a fee-based service in the early part of 2002.

Following the September 11 terrorist attacks, debate again surrounded the use of the FBI's high-tech surveillance tools. As part of the Patriot Act, which gives the FBI more leeway while investigating terrorist activities, online monitoring was also reinforced, giving authorities more power and raising concerns with privacy advocates.

Perhaps the most controversial high-tech surveillance tool discussed in 2001 was the FBI's "Magic Lantern" project. While government officials have confirmed its existence, they will not officially comment on what it does. According to reports, Magic Lantern involves sending a virus to a suspected criminal's computer. Once launched, the virus is designed to install a Trojan horse or backdoor program, and allow investigators to record everything typed into that machine, thereby getting around encryption and passwords.

The "Code Red" worm did about $2.6 billion worth of damage after it spread on the Internet.

Other notable events in 2001 include the launch of satellite radio; the continued downturn of the high-tech economy and layoffs in its work force; the first federal charges filed under the 1998 Digital Millennium Copyright Act (DMCA); the extended ban on Internet taxes; and the appointment of a U.S. cybersecurity czar in light of September 11.

And for anyone disappointed that the year wasn't anything like the ride into the monolith that Arthur C. Clarke had envisioned in "2001: A Space Odyssey," the author turned up -- by satellite from Sri Lanka -- at Comdex in Las Vegas to tell his audience, "Science fiction ... seldom attempts to predict the future. And more often than not, it tries to prevent the future."

With a year like 2001, many might shudder to think what may have been prevented.